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We are pleased to present the 2011 Toyota North America Environmental Report. Here you will find information on our environmental activities during fiscal year (FY) 2011, as well as a summary of the five-year period of our second environmental action plan (FY2007 – FY2011). This report also provides information on Toyota's economic presence in North America. Highlights of our performance are provided in Figure A.

The past five years presented a number of challenges. In FY2007, the economy experienced a strong downturn, and product recalls began soon after. We were faced with production slow-downs and hard decisions. And yet, despite our challenges, we found ways to reduce environmental impacts in all areas of our business. We used downtime to train employees, and we challenged them to find opportunities for improving our performance.

The result is that we met many of the targets in our environmental action plan, and in some cases even exceeded them. Where targets were missed, we still made progress reducing our impact. Employees even went beyond our walls and found opportunities in their communities, sharing their knowledge and expertise to improve the environmental performance of others.

Partnerships have been instrumental to our success. They are a key aspect of both our Guiding Principles and our Earth Charter. Our corporate vision encourages us to build close and cooperative relationships with a wide range of stakeholders to meet common goals.

In the last few years, we have begun to more fully realize the value of these partnerships. Partnerships allow us to demonstrate the feasibility of our advanced technology vehicles. Our partners help us reduce greenhouse gas emissions, recycle waste and reduce air emissions from activities such as painting. They help us find ways to use eco-plastics and renewable materials in the design of our vehicles.

But partnerships are also a way for us to help others. We are helping towns and counties reduce energy use, working with a nonprofit on making and testing biodiesel, and donating plastics to a community center for recycling. We conduct "treasure hunts" with suppliers to teach them how to find energy and water savings. We work with dealerships to help them build "greener" facilities. We partner with organizations to conserve public lands and promote environmental education. Details of these activities and many more can be found throughout this report.

Sustainability is at the heart of our vision for the future. Sustainability is about designing advanced technology vehicles with a low carbon footprint and producing vehicles with as little impact to the environment as possible. This is why the launch of our Prius Family concept at the Detroit Auto Show in January 2011 was so timely. These vehicles, beginning with Prius v, are being rolled out using hybrid technology that produces high fuel economy and low tailpipe emissions.

Sustainability is part of a broader vision of corporate responsibility that includes the safety and diversity of our employees and the well-being of the communities around us. No company can become sustainable by working on its own. We will continue to rely on partnerships to help us achieve our sustainability goals—and to help our partners achieve theirs.

SCOPE OF THIS REPORT:This North America Environmental Report covers activities across the North American region—the United States, Canada and Mexico. This report also covers the Toyota, Lexus and Scion brands in North America.

The period covered in this report is fiscal year 2011 (April 1, 2010 through March 31, 2011) and product model year 2011. We report on fiscal year 2011 activities and provide a five-year retrospective to recognize accomplishments and challenges at the close of our second five-year environmental action plan (FY2007 – FY2011). We also provide information on our company's economic presence in North America. If data is presented with different dates, this is clearly indicated.